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PRESS STATEMENT - IMF COVID-19 LOAN TO NIGERIA

Monday, May 4, 2020

PRESS STATEMENT

CSOs CALL FOR TRANSPARENCY IN THE USE OF IMF COVID-19 EMERGENCY LOAN TO NIGERIA

Civil Society Organisations in Nigeria welcome the International Monetary Fund’s (IMF) prompt response to the Federal Government of Nigeria (FGN) request for financial assistance to fight the COVID-19 pandemic and shore up the country’s failing economy by approving a loan of US$3.4billion in emergency support.

We, however, urge the Government of Nigeria to prioritize and utilise these funds to improve health spending, socio-economic safety nets, and support for small and medium scale enterprises.

Nigeria is facing its worst health, social, and economic crisis in decades. As in the rest of the world, the ongoing pandemic has knocked life out of Africa’s largest economy and threatens to collapse the country’s fragile health systems.

The crisis has led to a decline in tax revenues, collapse in commodity prices especially that of oil, Nigeria’s main export, diminishing official development assistance, and rising debt obligations, disrupted supply chains, and high inequality levels.

According to the IMF, the pandemic will trigger the worst economic recession since the Great Depression, and far worse than that seen during the 2008 financial crisis.

“Even before the ongoing pandemic, poverty and inequality levels were unacceptably high in Nigeria. Both the FGN and IMF therefore need to ensure that these funds are directed towards meeting the needs of the most vulnerable in society especially women, children, internally displaced persons and rural communities”, said Constant Tchona, Oxfam in Nigeria Country Director.

Active citizens are an asset to society, especially in times of crisis such as pandemics and economic collapse. “To ensure full transparency, openness and accountability in the application of this loan to serve the people who need it most, we urge both Government and IMF to take a step further and support the creation of a civil society network to contribute to monitor the disbursement of the funds”, said Auwal Musa, Executive Director of Civil Society Legislative Advocacy Centre.

The Government of Nigeria faces a dilemma of whether to save lives and livelihoods or continue meeting its obligations to global creditors. But it will cost more if government chooses the latter. Lives lost can never be recovered. We call for an immediate cancelation of all payments owed by Nigeria to bilateral, international financial institutions and commercial lenders that are due in 2020. This will allow the Nigerian Government the needed fiscal space to save lives, fight the pandemic and resuscitate the flagging economy.